AB317: Bill Text

LRB-2624/1

JTK:eev:eev

2013 - 2014 LEGISLATURE

2013 Assembly BILL 317

August 23, 2013 - Introduced by Representatives Wright, Smith, Hintz, Wachs, Jorgensen, Berceau, Richards, Goyke, Kolste, Johnson, Bernard Schaber, Shankland, Sinicki, Zepnick, Genrich, Hesselbein, Doyle, C. Taylor, Young, Ohnstad, Hebl, Ringhand, Vruwink, Milroy, Billings and Barca, cosponsored by Senator T. Cullen. Referred to Joint Committee on Finance.

AB317,2,3 An Act to repeal 13.48 (14) (am) 2. to 4., 13.48 (14) (bg) and (br), 13.48 (14) (c) 1. to 4., 13.48 (14) (cm), 16.705 (1b) (c), 16.848 (1) (b) and (c), 16.848 (1e), 16.848 (1m), 16.848 (1s), 16.848 (2) (am), 16.848 (2) (gx) and 16.848 (4) (c); to renumber and amend 13.48 (14) (am) 1., 13.48 (14) (c) (intro.), 13.48 (14) (d) and 16.848 (1) (a); to amend 13.48 (2) (b) 3., 13.48 (14) (title), 13.48 (14) (a), 13.48 (14) (b), 13.48 (20), 13.48 (22), 13.48 (23), 13.482 (2) (a), 13.488 (1) (a), 13.488 (1) (b), 16.310 (5), 16.84 (1), 16.848 (title), 16.848 (4) (a), 16.848 (4) (b) 3., 16.848 (4) (b) 5., 20.373 (1) (g), 25.60, 36.09 (1) (L), 36.11 (1) (b), 36.11 (1) (e), 36.11 (28), 36.33 (title) and (1), 36.33 (2) (title) and (a) (intro.), 36.33 (3), 41.23, 41.41 (7) (b), 44.015 (1), 45.03 (5) (c) 1. a., 46.03 (30) (a), 46.035 (2) (a), 46.06 (4), 51.06 (6), 84.01 (30) (g) 3., 84.09 (1), 84.09 (5) (a), 84.09 (5) (c) 1., 84.09 (5) (c) 2. (intro.), 84.09 (5) (c) 2m. (intro.), 84.09 (5m), 84.09 (6), 84.40 (2) (a), 85.09 (2) (a), 85.09 (4), 85.09 (4i), 85.15 (1), 108.161 (7), 108.161 (9), 114.33 (6) (a), 114.33 (10), 301.235 (2) (a) 1., 301.24 (4), 301.24 (4m) and 302.04; to repeal and recreate 16.848 (4) (b) 1.; and to create 13.48 (14) (d) 1., 3., and 4., 16.848 (2) (a), 16.848 (2) (b), 16.848 (2) (gw), 16.848 (4) (b) 2. and 84.09 (9) of the statutes; relating to: sale or lease of state property.

Analysis by the Legislative Reference Bureau

Currently, with certain exceptions, the Department of Administration (DOA) or the Building Commission may sell or lease state-owned real property if DOA or the commission determines that the sale or lease is in the best interest of the state. Any sale by DOA is subject to approval of the commission and any sale by DOA or the commission is subject to approval by the Joint Committee on Finance (JCF). Any sale may be either on the basis of competitive bids, with DOA or the commission reserving the right to reject any bid in the best interest of the state, or on the basis of negotiated prices as determined through a competitive or transparent process. Any sale may be with or without the approval of the agency having jurisdiction over the property to be sold. The authority does not apply to any property for which the cost of acquisition, construction, or improvement was financed at least 50 percent by gifts or grants or at least 50 percent by federal funds and does not apply to any property that is owned or leased by the investment board. Also currently, various state agencies have authority to sell or lease real property under their jurisdictions subject to various conditions and limitations if DOA or the commission has not exercised its authority to sell or lease the property and no sale or lease is pending. The net proceeds of any sale by DOA or the commission are first used to retire any public debt that was used to finance the acquisition, construction, or improvement of the property that is sold. Thereafter, the net proceeds are used to pay the costs of federal tax law compliance applicable to the debt. Thereafter, the net proceeds are used to retire any revenue obligation debt in the fund that was used to acquire, construct, or improve the property that was sold and thereafter, to pay the costs of federal tax law compliance applicable to the debt and thereafter to retire any similar revenue obligations. If the property was acquired, constructed, or improved with federal financial assistance, DOA must pay to the federal government any of the net proceeds required by federal law. If the property was acquired by gift or grant or with gift or grant funds, DOA must adhere to any restriction governing use of the proceeds. Thereafter, the net proceeds are used to retire other outstanding public debt. Currently, if any property that is proposed to be sold by DOA or the commission is co-owned by a nonstate entity, DOA or the commission must afford the co-owner the right of first refusal to purchase the share of the property owned by the state on reasonable financial terms established by DOA or the commission.

Currently, if DOA sells or leases a state-owned heating, cooling, or power plant, DOA may contract with the purchaser to purchase the output of the plant. Currently, if DOA or the commission sells any real property that was under the jurisdiction of a state agency prior to the sale, the agency must convey all systems, fixtures, or other property interests specified by DOA or the commission to the purchaser on terms specified by DOA or the commission. Current law also provides that if DOA or the commission sells or leases any property that was under the jurisdiction of a state agency prior to the sale or lease, DOA may decrease the authorized full-time equivalent positions for the agency and may lapse or transfer appropriated moneys from any appropriation made to the agency, other than a sum sufficient appropriation, an appropriation made to the Board of Regents of the University of Wisconsin System, or an appropriation of segregated or federal revenues, to account for discontinuance of the operation of the facility by the agency.

Currently, with limited exceptions, each state agency must submit a biennial report to DOA containing an inventory of all real property under its jurisdiction together with the estimated fair market value of each property. Each agency must specifically identify underutilized assets in the inventory. Following receipt of the inventories, DOA must obtain appraisals of all property in the inventories identified by DOA for potential sale and submit to the commission an inventory containing the location, description, and fair market value of each property identified for potential sale.

Under this bill, with certain exceptions, DOA may sell or lease state-owned real property if DOA determines that the sale is in the best interest of the state and the Building Commission approves the sale. Any sale may be either on the basis of public bids, with DOA reserving the right to reject any bid in the best interest of the state, or negotiated prices. Sales are not subject to the approval of JCF. The bill also permits state agencies to sell real property under their jurisdictions to the extent permitted by law. Generally, DOA's authority does not extend to property that another agency has authority to sell. In addition, DOA's authority does not operate to permit the closure or sale of any facility or institution the operation of which is required by law and does not apply to property under the jurisdiction of the Board of Regents of the University of Wisconsin System and certain property under the jurisdiction of the Department of Health Services at the Northern Center for the Developmentally Disabled. Any sale by DOA may be with or without the approval of the agency having jurisdiction over the property to be sold. The bill does not afford to any entity the right of first refusal with respect to the proposed sale of any property and does not permit DOA to decrease the full-time equivalent positions or to lapse or transfer moneys from the appropriations of any agency. The net proceeds of any sale are used to retire any outstanding public debt that was incurred to acquire, construct, or improve the property being sold and if the property was acquired, constructed, or improved with federal financial assistance, to repay the federal government to the extent required by federal law. If the property was acquired by gift or grant or with gift or grant funds, DOA must adhere to any restriction governing use of the proceeds. DOA must use any remaining net proceeds to retire other outstanding public debt.

The bill also permits the Building Commission, with certain exceptions, to sell state-owned real property where this authority is not given to another state agency by law and to transfer land under its jurisdiction among agencies. Sales may be accomplished in a manner similar to the manner in which sales are accomplished by DOA, except that sales of surplus land having a value of $20,000 are subject to the approval of JCF. Under the bill, the commission does not have the authority to sell a parcel of state-owned real property once DOA notifies the commission that an offer of sale or sale with respect to the parcel is pending. The net proceeds of any sales by the commission are used to retire any public debt that was used to acquire or construct any improvements on the property being sold. The remaining net proceeds must be deposited in the budget stabilization fund.

The bill does not require state agencies to file biennial reports with respect to all real property under their jurisdictions but instead directs state agencies to report biennially to the commission concerning parcels of surplus land under their jurisdictions and directs the commission to compile biennially and transmit to JCF an inventory of state-owned surplus land.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB317,1 Section 1. 13.48 (2) (b) 3. of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB317,4,8 13.48 (2) (b) 3. Except as provided in sub. (14) (am), the The building commission may lease space in buildings described under subd. 2. to other governmental bodies or to nonprofit associations organized for public purposes and shall charge those bodies or associations an annual rental which shall be not less than the cost of operating, maintaining and amortizing the construction cost of the leased space.

AB317,2 Section 2. 13.48 (14) (title) of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB317,4,11 13.48 (14) (title) Sale or lease of property lands.

AB317,3 Section 3. 13.48 (14) (a) of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB317,4,16 13.48 (14) (a) In this subsection, "agency" has the meaning given in s. 16.52 (7) for "state agency" in s. 20.001 (1), except that the term does not include the Board of Regents of the University of Wisconsin System.

AB317,4 Section 4. 13.48 (14) (am) 1. of the statutes, as affected by 2013 Wisconsin Act 20, is renumbered 13.48 (14) (am) and amended to read:

AB317,5,18 13.48 (14) (am) Except as provided in this paragraph and subject to par. (d), the building commission shall have the authority to sell or lease all or any part of a state-owned real property unless the sale or lease is prohibited under the state or federal constitution or federal law or the sale is conducted as a part of a procedure to enforce an obligation to this state building or structure or state-owned land, including farmland, where such authority is not otherwise provided to an agency by law, and may transfer real property land under its jurisdiction among agencies. The commission may sell or lease property under this paragraph with or without the approval of the agency having jurisdiction over the property and regardless of whether the property is included in an inventory submitted under par. (d). The building commission does not have the authority to sell or lease any state-owned real property under this paragraph after the department of administration notifies the commission in writing that an offer of sale or sale or lease agreement with respect to a property is pending under s. 16.848 (1). If the sale or lease is not completed and no further action is pending with respect to the property, the authority of the building commission under this paragraph is restored.

AB317,5 Section 5. 13.48 (14) (am) 2. to 4. of the statutes, as created by 2013 Wisconsin Act 20, are repealed.

AB317,6 Section 6. 13.48 (14) (b) of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB317,6,7 13.48 (14) (b) The Subject to par. (d), the building commission shall sell or lease on the basis of either public bids, with the building commission reserving the right to reject any or all bids in the best interest of the state, or on the basis of negotiated prices as determined through a competitive or transparent process. Buildings, structures and land mentioned in this subsection shall be subject to general property taxes levied by those taxing bodies within whose area they lie if used for commercial purposes, and shall be subject to special assessments for public improvements in the same manner and to the same extent as privately owned real property buildings, structures, and land, subject to approval of the building commission when required under s. 66.0703 (6).

AB317,7 Section 7. 13.48 (14) (bg) and (br) of the statutes, as created by 2013 Wisconsin Act 20, are repealed.

AB317,8 Section 8. 13.48 (14) (c) (intro.) of the statutes, as affected by 2013 Wisconsin Act 20, is renumbered 13.48 (14) (c) and amended to read:

AB317,7,18 13.48 (14) (c) Except as provided in par. (e), if If there is any outstanding public debt used to finance the acquisition, of a building, structure, or land or the construction, or improvement of any property a building or structure that is sold or leased under par. (am) (b), the building commission shall deposit a sufficient amount of the net proceeds from the sale or lease of the property building, structure, or land in the bond security and redemption fund under s. 18.09 to repay the principal and pay the interest on the debt, and any premium due upon refunding any of that debt. If there is any outstanding public debt used to finance the acquisition, construction, or improvement of any property that is sold or leased under par. (am), the building commission shall then provide a sufficient amount of the net proceeds from the sale or lease of the property for the costs of maintaining federal tax law compliance applicable to the debt. If the property was acquired, constructed, or improved with federal financial assistance, the commission shall pay to the federal government any of the proceeds required by federal law. If the property was acquired by gift or grant or with gift or grant funds, the commission shall adhere to any restriction governing use of the proceeds. Except as required under par. (e) and ss. 20.395 (9) (qd) and 51.06 (6), if Except as provided in s. 51.06 (6), if there is no such debt outstanding, there are no moneys payable to the federal government, and there is no restriction governing use of the proceeds, and or if the net proceeds exceed the amount required to be deposited, paid, or used for another purpose under this subsection repay that principal and pay that interest and premium, the building commission shall use deposit the net proceeds or remaining net proceeds to pay principal and interest costs on outstanding public debt issued to finance the acquisition, construction, or improvement of property. If any net proceeds remain thereafter, the commission shall use the proceeds to pay principal and interest costs on other outstanding public debt. For the purpose of paying principal and interest costs on other outstanding public debt under this paragraph, the commission may cause outstanding bonds to be called for redemption on or following their optional redemption date, establish one or more escrow accounts to redeem bonds at their optional redemption date, or purchase bonds in the open market. To the extent practical, the commission shall consider all of the following in determining which public debt to redeem: in the budget stabilization fund.

AB317,9 Section 9. 13.48 (14) (c) 1. to 4. of the statutes, as created by 2013 Wisconsin Act 20, are repealed.

AB317,10 Section 10. 13.48 (14) (cm) of the statutes, as created by 2013 Wisconsin Act 20, is repealed.

AB317,11 Section 11. 13.48 (14) (d) of the statutes, as affected by 2013 Wisconsin Act 20, is renumbered 13.48 (14) (d) 2. and amended to read:

AB317,8,12 13.48 (14) (d) 2. Biennially, beginning on January 1, 2014, each agency other than the investment board shall submit to the department of administration an inventory of all real property under its jurisdiction. Except with respect to the Board of Regents of the University of Wisconsin System, the inventory shall include the estimated fair market value of each property. The agency shall specifically identify any underutilized assets in the inventory. No later than July 1 following receipt of the inventories, the department of administration shall obtain appraisals of all properties in the inventories that are identified by the department for potential sale and 1984, each agency having surplus land shall submit to the building commission and the joint committee on finance an inventory containing the location, description and fair market value of each parcel of property identified for potential sale surplus land.

AB317,12 Section 12. 13.48 (14) (d) 1., 3., and 4. of the statutes are created to read:

AB317,8,17 13.48 (14) (d) 1. In this paragraph, "surplus land" means land under the jurisdiction of the commission and allocated for use by an agency, but unused and not needed for the agency's operations or included in the agency's plan for construction or development.

AB317,8,20 3. Except as provided in subd. 4., the commission shall annually, beginning January 1, 1984, submit to the joint committee on finance an inventory of surplus land containing the following information for each parcel:

AB317,8,21 a. The location, description and fair market value.

AB317,8,23 b. Whether the commission intends to sell or transfer the use of the parcel from one agency to another agency.

AB317,8,25 c. If the commission intends to transfer use of the parcel from one agency to another agency, whether transfer of the parcel is critical or desirable.

AB317,9,12 4. If the commission proposes to sell or transfer a parcel of surplus land having a fair market value of at least $20,000, the commission shall notify the joint committee on finance in writing of its proposed action. If the cochairpersons of the committee do not notify the commission that the committee has scheduled a meeting for the purpose of reviewing the proposed sale or transfer within 14 working days after the date of the commission's notification, the parcel may be sold or transferred by the commission. If, within 14 working days after the date of the commission's notification, the cochairpersons of the committee notify the commission that the committee has scheduled a meeting for the purpose of reviewing the proposed sale or transfer, the parcel may be sold or transferred under this subdivision only upon approval of the committee. This subdivision does not apply to surplus land that is authorized to be sold under s. 16.848.

AB317,13 Section 13. 13.48 (20) of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB317,9,18 13.48 (20) Residence halls. Except as provided in sub. (14) (am), the The building commission may approve the sale or lease of state-owned residence halls by the board of regents of the University of Wisconsin System to another state agency or a nonstate nonprofit agency for purposes provided in s. 36.11 (1) (e).

AB317,14 Section 14. 13.48 (22) of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB317,9,25 13.48 (22) Sale or lease of capitol area lands. The building commission may lease or resell lands acquired in the capitol planning area for public or private redevelopment and may set such conditions of sale or lease as it deems necessary to ensure development compatible with the needs of the community and the state. This subsection does not apply to lands that are authorized to be sold or leased under s. 16.848 while an offer of sale, sale, or lease agreement is pending or while the lands are leased.

AB317,15 Section 15. 13.48 (23) of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB317,10,11 13.48 (23) Lease of space for commercial use. Except as provided in sub. (14) (am), the The building commission may lease space in state office buildings for commercial use, including without limitation because of enumeration, retail, service and office uses. In doing so the building commission shall consider the cost and fair market value of the space as well as the desirability of the proposed use. Such leases may be negotiated or awarded by competitive bid procedures. All such leases of space in state office buildings shall provide for payments in lieu of property taxes.

AB317,16 Section 16. 13.482 (2) (a) of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB317,11,16 13.482 (2) (a) For the purpose of providing housing for state departments and agencies, including housing for state offices and the completion of the state office building, and to enable the construction, financing and ultimate acquisition thereof by the state, the building commission may acquire any necessary lands, and, subject to s. 13.48 (14) (am), lease and re-lease any lands owned by the state and available for the purpose to the Wisconsin State Public Building Corporation or other nonstock corporation organized under ch. 181 that is a nonprofit corporation, as defined in s. 181.0103 (17). The lease and re-lease shall be for a term or terms not exceeding 50 years each and shall be made on the condition that such corporation shall construct and provide on such leased lands such building projects, including buildings, improvements, facilities or equipment or other capital items, as the building commission requires, and shall re-lease the same to the building commission upon satisfactory terms as to the rental, maintenance and ultimate acquisition by the state as is in its best interests in the judgment of the building commission. After such leases and re-leases are executed and until the projects are acquired by the state, they shall be operated by the building commission through the department of administration, which shall have charge of such property as provided in ss. 16.85 and 16.8511. The building commission shall operate the projects in such manner as to provide revenues therefrom sufficient to pay the costs of operation and maintenance of the project and to provide for the payments due the Wisconsin State Public Building Corporation or other nonstock, nonprofit corporation but if the building commission finds and declares that the housing available in any such project is in excess of the current housing needs or requirements of the state departments and agencies occupying or availing themselves of the space in or capacity of such project, the building commission need not operate such project in a manner to provide revenues therefrom sufficient to pay the costs of operation and maintenance of the project and to provide for the rental payments due the Wisconsin State Public Building Corporation or other nonstock, nonprofit corporation.

AB317,17 Section 17. 13.488 (1) (a) of the statutes, as affected by 2013 Wisconsin Act 20, is amended to read:

AB317,11,23 13.488 (1) (a) Without limitation by reason of any other statutes except s. 13.48 (14) (am), the power to sell and to convey title in fee simple to a nonprofit-sharing corporation any land and any existing buildings thereon owned by the state for such consideration and upon such terms and conditions as in the judgment of the building commission are in the public interest.